Estimating seed demand in the presence of market frictions: Evidence from an auction experiment in Nigeria.

This paper measures the effect of seed quality misperceptions on bidding behavior and demand for high-quality seed using an information-provision experiment within an incentive-compatible Vickery Second Price (SPA) auction mechanism that mimics seed purchasing decisions in the presence of seed market frictions. We find that most individuals are prone to quality misperception and revise their bids upwards (downwards) in response to positive (negative) quality signals. In addition, by exploiting random variation in the timing of cash grants, we show that imperfect information influences farmer seed valuation, even in the presence of potentially binding liquidity constraints. We also demonstrate that the provision of quality information does not fully resolve quality misperceptions. We then show that unresolved or persistent misperception is severe enough to distort bidding behavior, and ignoring it could lead to biased willingness-to-pay estimates. Our findings have important implications both for improving inference related to the identification and estimation of willingness to pay for quality seed in the presence of market frictions, and for the design of seed sector polices in developing countries.

Potential returns to yam research investment in sub-Saharan Africa and beyond.

Lack of good-quality planting materials has been identified as the most severe problem militating against increased agricultural productivity in sub-Saharan Africa (SSA) and beyond. However, investment of research efforts and resources in addressing this menace will only be feasible and worthwhile if attendant economic gains are considerable. As a way of investigating the economic viability of yam investment, this research has been initiated to address problems confronting yam productivity in eight countries of SSA and beyond: Nigeria, Ghana, Benin, Togo, Côte d'Ivoire, Papua New Guinea, Jamaica, and Columbia. Research options developed were to be deployed and disseminated. Key technologies include the adaptive yam minisett technique (AYMT), varieties adapted to low soil fertility and drought, nematode-resistant cultivars (NRC), and crop management and postharvest practices (CMPP). This article aims at estimating the potential economic returns, the expected number of beneficiaries, and poverty reduction consequent to the adoption of technology options. Estimates show that the new land area that will be covered by the technologies in the eight countries will range between 770,000 ha and 1,000,000 ha with the highest quota accounted for by AYMT. The net present value will range between US$584 and US$1392 million and was highest for the NRC. The CMPP had the lowest benefit-cost ratio of 7.74. About 1,049,000 people would be moved out of poverty by these technologies by 2037 in the region. These technologies are less responsive to changes in cost than that in adoption rate. Therefore, the realization of the potential economic gains depends on the rate and extent of adoption of these technologies. Giving the knowledge-intensive nature of some of these interventions, capacity building of potential adopters will be critical to increasing the sustainability of the yam sector, thereby enhancing food security and reducing poverty.

The poverty impacts of improved cowpea varieties in Nigeria: A counterfactual analysis.

Adoption of improved agricultural technologies has long been recognized as critical for reducing poverty through increased productivity, incomes, and asset accumulation. Using a nationally representative survey data from a sample of over 1500 households in Nigeria, this paper evaluates the impacts of adoption of improved cowpea varieties on income and asset poverty reduction using an endogenous switching regression model. The results showed that adoption of improved cowpea varieties increased per capita household income and asset ownership by 17 and 24 percentage points, respectively. The results based on the observed and counterfactual income and asset distributions further showed that adoption reduced both income poverty and asset poverty by 5 percentage points. The paper concludes with a discussion of the policy options for increasing adoption and impacts of improved cowpea varieties in Nigeria.

Plot-level impacts of improved lentil varieties in Bangladesh.

The advent of improved lentil varieties (ILVs) in the mid-1990s solved the disease problem which almost halted lentil production in Bangladesh. Levels of adoption of ILVs have been documented in the literature, but little is known about their impacts. Applying an instrumental variables regression to data collected from a sample of 1,694 lentil plots and DNA fingerprinting for varietal identification, this study provides estimates of the plot-level impacts of adoption of ILVs in Bangladesh. Model results show that adoption of ILVs is associated with 14.3% (181.14 kg/ha) higher yields and 17.23% (US$169.44/ha) higher gross margins. Since 45% of lentil area is under ILVs, they generated over 8.77 tones (6%) more supply of lentils from domestic sources, saving the country US$8.22 million in imports in 2015 alone. By investing in the generation and scaling of ILVs, Bangladesh and other South Asian countries with similar agro-ecologies can increase production and decrease dependency on lentil imports.

Market participation, household food security, and income: The case of cowpea producers in northern Nigeria.

This article evaluates the impact of cowpea market participation on household food security and income in northern Nigeria. Using household survey data from a representative sample of over 1,500 farm households and applying a combination of instrumental variable techniques and dose-response functions, we found that cowpea market participation had a statistically significant positive impact on household food security and income. Cowpea market participation increased food expenditure by 1.6% and household income by 0.7% with a 10 unit increase in the quantity of cowpea sold. These results underscore the importance of cowpea market participation for household food security and income improvement. We also found that selling cowpea to rural and urban traders significantly increased household income, food expenditure, and food security. Results show that selling cowpea to rural and urban traders increased household income by 17% and 13%, respectively. The results point to the need for an enabling policy environment and public infrastructure to enhance market participation of farmers and traders. Public infrastructure investments in the form of feeder road construction and maintenance in the distant villages are encouraged, which in the long run can translate into improved cowpea productivity and welfare of smallholder farmers.

Identifying crop research priorities based on potential economic and poverty reduction impacts: The case of cassava in Africa, Asia, and Latin America.

It is widely recognized that increasing agricultural production to the levels needed to feed an expanding world population requires sharply increased public investment in research and development and widespread adoption of new technologies, but funding for national and international agricultural research has rather declined in recent years. In this situation, priority setting has become increasingly important for allocating scarce research resources among competing needs to achieve greater impacts. Using partial equilibrium economic surplus models and poverty impact simulations, this paper assesses cassava research priorities in Africa, Latin America and Caribbean, and Asia based on the potential economic and poverty reduction impacts of alternative research and technology options. The results showed that efficient planting material production and distribution systems and sustainable crop and soil fertility management practices have the greatest expected economic and poverty reduction impacts in the three regions. Lack of clean planting materials is a major constraint to adoption and it is envisaged that efficient production and distribution systems for planting material can accelerate technology adoption by farmers. Similarly, sustainable crop and soil fertility management practices play a key role in closing the observed yield gaps, especially in Africa. The paper discusses the results of the priority assessment for key cassava research options and concludes with the implications for cassava research priorities.